E.L.F. earnings jump more than 60% in Q2
today Nov 7, 2019
Following a surprise loss in Q1, cruelty-free cosmetics brand E.L.F. Beauty announced strong year-over-year improvements in both sales and earnings for the second quarter on Wednesday, as the company’s restructuring efforts begin to pay off.
For the second quarter ended September 30, 2019, E.L.F. reported net income of $6.5 million, up 67% from the $3.9 million announced by the Oakland, California-based company in the prior year period. Diluted earnings per share (EPS) were $0.13, compared to $0.08 in the previous year’s second quarter.
This progress was driven by a solid 6% rise in the brand’s quarterly net sales, which increased from $63.9 million to $67.6 million. This growth was, in turn, pushed by increased productivity across E.L.F.’s channels, as well as higher product prices implemented in response to recent tariff hikes.
Sales growth was partially offset by the shuttering of all 22 of the company’s retail stores – which accounted for $3.2 million in sales in the prior-year period – in February 2019. Disregarding this contribution, E.L.F.’s net sales rose 11%.
“We are making significant progress executing against our five strategic imperatives and are pleased with the initial results of our brand recharge,” commented E.L.F. Chairman and CEO Tarang Amin in a release. “The increase in our marketing and digital activations coupled with the impact of our Project Unicorn initiative is driving productivity across channels, including on elfcosmetics.com.”
In the first half of the year, E.L.F.’s net sales totaled $127.4 million, up 4% from the $122.9 million posted by the cosmetics company in the first six months of fiscal 2019. Net income for the period was $10.2 million, or $0.20 per diluted share, compared to $5.2 million, or $0.10 per diluted share.
In light of its positive results, E.L.F. has raised its outlook for the full fiscal year 2020. The company now expects to report annual sales of between $265 million and $272 million, up from a previous estimate of between $24million and 256 million. Adjusted net income is predicted to be in the range of $23 million to $25 million.
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